tomorrow we're watching for the feds beige book.

anecdotal collections of economic reports. last time they made a step up and suggested the economy was turning around. looking for new signs of recovery inside tomorrow's beige book. i'm hampton pearson in washington. i'll be watching the initial session of the financial crisis inquiry commission, taking a soul searching look at the root causes of the financial crisis one year later. before we go, let's take a look at how the market begins tomorrow's trading session after some losses today. the dow jones industrial average gave up about 36 points, about.3 of 1%. certainly off of the worst levels of the session. having said that, 10627 on the dow. nasdaq down 30 points. the s&p 500 tonight, weaker by ten points at 11.36. later in the week we're waiting on earnings from jp morgan and intel among others as we again the fourth quarter earnings season in earnest later this week. thanks so much for joining us

tonight on "closing bell." i'll see you tomorrow, same time, same place. fast money's up next. have a great night. investors starting to bail before earnings season ramps up. should you? live from the nasdaq market site this is "fast money." is it time to sell intel and jp morgan? these traders have the ways to make money when the trend is moving against you. later in the show a noted stock guru who called the march g bottom. intel big dip today. >> everyone's wringing their hands about technology stocks. intel's just off its highs. it's had a hard time getting over 21. a market under heavy pressure. the s&p 500 huge down today. down 14 points. everyone gets all afraid about the s&p. but they all start looking at the intel, looking at the smh.

all the rest of that. implied materials, their exposure to the silicon space when you're talking about all of everything that goes into the machinery for the technology space and the solar space, that still working the stock 70 cents off its 52-week highs. i think intel is ready to spike on the next earnings report. >> evaluation looks decent considering the run. an analysis says 11 times forward earnings, that's what intel is trading up when you minus cash. tim, you're in there picking up intel? >> i think intel is very interesting here. i think they're going to announce thursday this reorganization. i think that gives you a little bit of callous. the main thing is to show chip sales outside of pcs is growing. mobile. some of the commercial uses of the chips. they seem like they're guiding towards better news. the reality is this reorganization is a chance to show a slightly more opportunistic look at the revenue stream. >> pete mentioned clearly the

market was under pressure today, defensive node. sold some technology today. didn't do much against it today other than looking at it. like microsoft still. like qualcomm still. love emc. it's a name i'll probably add. >> intel, this has not made the run we saw out of alcoa. alcoa was up 20% going into the earnings in the last month. 40% over the quarter. look at intel. the entire quarter it is basically traded ed at 20.5. last earnings spiked to 21 and change. 21.90 in the aftermarket. it pulled back and has been sitting here ever since. the street's looking for 25 bucks. it's well underneath that. if the street is right -- >> you guys raise a good point. 21 seems like the continual resistance level. does that concern you? >> no. >> why? >> we've seen a lot of rotation in the last couple weeks.

i think, again, we talked about the four or five tech names that drove tech in the first part of the year. technology suffered over the last three days. intel traded pretty well. i actually think the greater story is the market is tired here. we had six straight days up in the s&p. we've done that four times to start the year in history. i think the market was looking for reasons to take chips off the table today to even initiate some shorts. i think intel is a place where you'd be dangerous to do that. the stock has lagged the rest of the sector and probably has the best fundamentals. >> it's not about intel the trade. it's intel and the rest of technology. if intel reports well it's other technology names you want to buy. >> that's a good point. karen, google is one of those names down about 5% so far this year compared to the broader markets which is up. you've been dipping your toe into google. now down at about 590 or so. >> part of what we do is figure out has something fundamentally changed or is there just noise? i think this is just noise. for us the next catalyst in

google or apple, another name that hasn't done particularly well since the beginning of the year is earnings. these are earnings driven stories. as well as market stories. but for google if you can just hold on till, like, january 21st, it's not that far away. >> seems like forever. >> i know. for long-term value investors like us, it's just going to be one quarter's data. we'll see. we'll start to get real information that will help us assess whether or not these are value plays. i think they are. i think that what we see from both apple and google will confirm these are value plays. >> would you consider adding to your google position on the 590? >> yes, i would. >> let's bring in gary. this is the man who warned you about this large cap tech selloff. in, in fact, told you to short the cubes. pretty good call last week. he joins us on the fast line. what are you doing now? >> hey, melissa. good evening. you know, just following up with what karen said, i'm still short the qs.

fundamentals sometimes don't matter. as i mentioned on the show last thursday, we're in a period right now where portfolio managers are trying to raise some cash. they're selling winners, although that may be a long-term bad strategy. the nasdaq is -- these were the 2009 winners. i continue to believe that as we enter into earnings, that the tms will continue to lighten up. >> wait a minute, gary. pms trying to raise cash? i thought going into the end of last year we were talking about all this cash on the sidelines coming into the mashlrket. what happens to that cash? >> i guess i may sound a little crazy here. i think i've echoed this for some time now. the melt-up we have from august to december was a lot of cash on the sidelines that was getting put into the market. there is not that much cash around. the cash that is so-called cash is staying as cash. you saw that today from the action in the treasury market. the money some money managers are receiving, this is a very important point, people are

selling fund a and reallocating to fund b. all the money managers are receiving outflows. the net effect is there's really not that much new money going in, and that's a big fallacy people must be aware of. >> it's karen. i got to differ with you. i think hedgefund flows, there's incoming money to hedge funds and that needs to be deployed. maybe not in the mutual fund space. although i would bet money starts to flow there, too. you can't discount the effect of hedge funds getting new money. >> i hate to pile on. the other thing you're seeing in the hedge fund industry is that a year ago all the -- a lot of funs were dated. a lot were not allowed to get their money out. because it was a decent year, because some managers got above high water marks money is starting to loosen up in the hedge fund space. i'm seeing it in emerging markets. emerging markets are one of the places people are putting money. i think we're going to have a record fund flow data in the first quarter. i think there is money that wants to come to the market.

the way the market traded the first six days of the year, ground higher every day even though it started slowly. >> wouldn't the outflows be more attached to those that didn't participate, the folks that didn't actually get part of this rally so people are taking money out of some of those funds? it would seem to me the folks who did well, actually got into technology run, got participation, would still want to keep their money with the same money manager. >> gary, what do you have to say? >> i don't dispute the fact that there are some certain hedge funds getting inflows. my surveillance tells me a lot of the money going into the mutual funds or hedge funds getting inflows, it's not coming from cash on the sidelines. it's coming from other money managers. i'll stick with my point. i think that maybe the market's exhausted here. i think we have to be very -- you have to pay attention in terms of what happens with this earnings season. i believe that we're going to trade sideways here with the nasdaq being biased on a relative basis more to the

downside because those are the names that are over all -- i know we talk about other ways to look at things that are overcrowded. i can tell you -- big cap -- is overcrowded. >> knowing you as long as i did i can be the one to say, you're crazy. we lost him. lost him. >> he didn't think that was funny. >> we'll check in with gary tomorrow as well. see how the short trade is going on the techs. next right here, investors bailing on financials today as well jp morgan losing 3% ahead of earnings on friday. one we highlighted on the halftime report, goldman sachs breaking down its 50-tay moving average. that's our chart of the day. break down or buying opportunity? joe? >> i agree with karen. you give this time. it's a buying opportunity. give it time. karen brings up january 21st. that's going to be a huge day in terms of earnings. american express, google, goldman sachs. wait till that day. it looks like the momentum is down. be a little bit patient. then the next trade in this to me is to buy it.

>> is to -- okay. joe, you were also saying in the green room before the show you'd be long in jp earnings at some point. >> my plan is to buy jp morgan absolutely. i think the earnings will look very good. i think the stock goes above 45. >> if those earnings are good, wouldn't it follow that probably the xlf will go higher as a whole? >> i'm not looking at the xlf. i'm looking at the difference between goldman sachs jp morgan capital mortgage model. momentum right now, goldman sachs is pointed down. jp morgan's kind of taken the medicine on the downside. it's hanging out there right now around the 43, 44 level. i like that in the short term. in the longer term i like both of them. >> karen, you were long bank of america still. >> jp morgan i do have calls. not my normal -- three days left to go. i think it'll be a very interesting earnings report and set the tone for the weeks to come. big names like bank of america, it is a little bit different

business model as joe is alluding to than goldman sachs. we'll have some clarity there. i think if those earnings provisions start to come down we'll really start to see earnings power. >> your calls specifically expire on the day they report. >> they report in the morning. the calls go in the afternoon. leaves me all day to pretend like -- >> i love it! >> look at the xlf. what we saw last week was the folks that were rolling out of january into february trying to buy a little time. almost had to pull the rip cord today. when you look at the xlf it actually did close above 15. morgan stanley actually didn't finish quite on the lows of the day. that was a little bit helpful. u.s. bank was the out lier that really stood out to me. yesterday the put protection buying. people out there not necessarily speculating for a downside move. buying puts to protect themselves going way out to june. we talk about a market. is it really exhausted? this market's up 21 points since 2009 came to a close in the s&p 500. i'm looking at the xlf trading up over 15. haven't broken up above there in

quite a while. i'm not so sure we're looking at an exhausted market. maybe a pause. maybe a pullback, sure. >> let's ask you how you're trading earnings. fast money call of the day. our question is whether the trading opportunities in the coming earnings season, this is what we asked you yesterday. you guys responded you're basically stock picking. it's a stock pickers market when it comes to earnings season. that is an interesting result. >> i think the financial sector is going to show you that. the regionals are probably going to shake out a little bit. i think the regionals are actually poised to do much worse than some of the big money center banks because of the commercial real estate. >> the consensus for 2010 is a stock pickers market. we're going back, going old school, looking at companies, analyzing balance sheets, seeing where the stock is going, not worrying so much where the broad market is going to be. >> let's move on to our next trade. big market buzz kill today,in a names. not entirely surprising given the monster run both names had

yesterday. it was that crop report that just sucked the oxygen out of this. >> it's a horrifying crop report when you have 13.5 billion bush bushels of corn being planted. this is a record. this hurts the fertilizers. corn prices came straight down. wheat came straight down. soy came straight down. if they don't have higher prices for crops, they won't by fertilizers. it obviously hurt the rest of the sector. guys playing that from the bulk side or fertilizers, today was a tough day. i don't agree with that move. it's a great chance to pick your spot. i think these names have a couple more days to weaken up. potash, i think in this current -- >> we talked about volatility in the ag space. look at the crop report, the response in the future -- >> you said it. you said who trades this thing the night before a report. >> it is like going to vegas, atlantic city. in an otherwise dismal, cranky day for me this was the one bright spot that i did not walk in owns the graining because i

wanted to own corn. i looked all day. i watched all day corn futures. they were limit down the entire day. that motivated me to sell agrium. the tape forced me to do it. i agree with timmy. i think right now the ag trade points lower. >> let's move on. let's go inside a trade. moments from now, we will hear the closing remarks at the jp morgan health care conference. right now we've got the senior biotech analyst who's been at the helm of that market moving conference this week. before we trade that, pete, what are you taking a look at here? >> i think amgen sticks out. it actually got pushed down again today on the release they're actually looking towards the lower end of what they're looking for for 2009. 495 to 505 is the range. that's really what hit the stock today.

revenues looked strong. i think this is a name, it's pulled back almost $10 from the highs. it gets awfully attractive. i'd like to hear what they really think about this stock right now. when you look at what its pe is trading at, biotech stock trading at 11 pe, an interesting stock. >> you're not ready to pull the trigger yet. >> i have not yet. >> let's bring in senior biotech analyst over at jp morgan. jeff, you've been busy of late. certainly amgen has news. are you a buyer of this stock at this level? >> you know, i am a buyer of this stock. the reality is, is that osteoporosis this year is going to launch. you'll have good data for dmab in cancer. there are catalysts. it's cheap. it's a ten multiple on this year. >> where do you see the stock going by tend of the year? >> i think we probably can get to the mid-60s. the real option here is dmab and prostate cancer with regards to

the prevention trial. that's probably a mid-year event. that's a call option i think that could be worth 10%. >> how about mankind? that was one of the names that actually was there as well today. this is a stock we're talking about, what they're able to do in the insulin space. everybody else gave up on inhaleable insulin. are they going to need a partnership? have they alluded in any way to that fact? >> they probably will need a partnership. officially the stock his covere by my colleague. you're absolutely right. to have success in the diabetes market these guys need a partnership. it's definitely primary care. hard to do for a small cap biotech. >> we know you have a busy schedule ahead. joining us from what is known as the super bowl of health care conferences out there, jp morgan health care conference. pete, you convinced? >> it trades so cheap right now. when you're talking about a biotech, nice pipeline i think amgen does look attractive. a name not on my screen today

too much. there were so many other things. alcoa and commodity space took my attention. definitely a name over the next couple of weeks. >> go in and buy it. >> what did we say? >> keep it clean, guys. do not go anywhere. it'll be the clip played in squawk box tomorrow morning. doug cass on his next market moving call. we've got it tonight. here's what else is coming up on the show. >> is a casino comeback for real even in this economy? traders betting heavy on this trade. but should you double down here as well? and they bring the market's biggest plays to the individual investor. so what's the next big wave to profit? bob pisani on how to trade the economy booted etfs. plus, the golden arches makeover continues with free wi-fi joining lattes on the menu. is the pit boss done with this trade or back for a bigger bite? c

welcome back to "fast mon money." for our next guest it is a

simple question. earnings woes plus china growth worries equal lower stock prices. how much lower? doug cass was early to the sub prime crisis, then called the lows on cnbc back in march. he's back with a very big announcement. doug, what's the next stop for stocks? >> hey, guys. i'm reminded of a quote by mark mcgwire, the major league baseball player who admitted yesterday he used steroids. he said, do you want to know the truth or do you want to see me just hit a few dingers or homeruns? i think that in markets, also, obviously in life, we're consistently bamboozled by appearances consensus. too often we're played as suckers as we accept the trend or in the case of the market the price momentum. we accept it as a certain truth without a shred of criticism and objecttivity. i think it's time -- i think what we've learned from history is how wrong conventional wisdom can be, that uncertainty always will persist and that the occurrence of all these black swan events are growing in

frequency. >> what does this mean, doug? >> that i'm negative. the consensus is clustered both for economic corporate profit growth and market expectations around a very narrow set of favorable outcomes. i believe the consensus economic and outlooks remain among the more likely outcomes next year, perhaps even the most probable outcome. where i stray is that there exists owing to a number of cyclical influences -- >> going back to the original question, doug, with all due respect, what is the next stop for stocks? are we in for some sort of a correction here? >> yeah. i think we're going to have a correction. i think there's some discreet clouds gathering. we're seeing renewed fears of populism. the administration considering launching a tax on financial institutions. i'm very fearful of the ramifications of populism in the next two years on economic growth and the market prospects pip think joe was talking about

alcoa last evening. the industrial trade is obviously far too crowded. thirdly, china guided -- this is tim's while house as we knows. also raised bank reserve requirements. i think they're setting the stage for a rise in benchmark interest rates. i think we follow. >> doug, let's talk about that real quick. i read your piece this morning. insightful, callful, cynical as usual. two things i disagree with. on china this is not a real estate bubble like we've had here. this is a tap on the brakes by the chinese central bank. they're in control. they're absolutely worried about the devastation that would come if they had a pop in that bubble. socially they cannot tolerate it. the reason this is happening is their economy is very strong. you debate the numbers, but the numbers are absolutely real. china can't be the answer to the u.s.'s issues. but to say that china is not happening, today's step on the brakes by china was not an accident. it was something that they've been choreographing. we're not surprised by it.

in fact, it's a sign of economic strength. >> timmy, the markets have assumed that china is going to wait for the u.s. to raise rates or doing so out of fear that the bigger rate differential is going to attract speculative capital and add more money to the chinese economy, which is already awash with cash. i think china's going to move first to raise rates in order to combat asset bubbles at home. and also, you know, officials have repeatedly warned that property prices are rising far too rapidly. but so far they've relied largely on land and tax policies to -- >> bottom line, how big of a pullback? what sort of time frame are we looking at? >> i think what's going to happen is that the market is going to be nonplussed by the fourth quarter earnings. this is going to disappoint people. people are going to realize this market has discounted a lot of the improvement and that we're going to get whacked in the next couple of months. >> what's whacked. give me a number. doug kass, always a pleasure to speak with you.

whacked by 10%. >> doug brings up some good points. unfortunately last night china placed me in a very cranky mood. i left here with a horrible position in alcoa. last night stayed up all night trading oil. fortunately what saved me is the fact today is tuesday. the fact that it's tuesday saved me. i went, i did my leg workout, went up to the football field, did my sprints. seriously. that means i did not sit there and watch oil. i stayed short oil. it saved my day. because i walked in with an absolutely alcoa situation. >> thank goodness for the leg exercises. >> if you think china is actually slamming on the brakes, the things you want to be short up here are things like volley, bhp, the integrated miners that have been on run-up. we've all been saying china is importing everything they've got. if this is true, which i don't think it is, get short those names. they've been fluffed up. >> watching mgm rallies 9% after being upgraded to a buy over at

goldman sachs. goldman calling ate high risk, high reward call. stock now up 28% so far in this young year. >> they also called it less bad. the situation in vegas is less bad. if you go back to late december we had a lot of options activity. we got a chance to talk about it on the desk. they were going all the way out to the january 2011 calls. they bought over 20,000 of these for 70 cents. yesterday they came back and bought even more of the 2011 strike. now the open interest on that strike is over 52,000 contracts. somebody out there is putting a lot of money down. they put more money down at $ $1.20 yesterday to buy more expecting at mgm to continue on higher highs. >> why would one go out to 2011? it seems like a lifetime away. >> buying time. i know we've talked about it on the desk. the short interest here is massive as well. they're buyi ining time.

>> volatility was virtually nil. i mean, you know, at the time of the buying. there is volatility now. but the volatility had come way down in the volatility -- >> my question for karen would be, do you think any of it is related to them needing to refinance this $4.2 billion worth of credit facility that matures in 2011? i looked at mgm. i couldn't understand all the restructuring that's going on there. >> i'm not that familiar with the story. if they do refinance and do any kind of equity offering you would think that would be a negative for the stock. so i don't know. i would think it would be a bit of a negative. >> it is interesting, the activity that we saw today and the past couple days. moving on, certainly we mentioned alcoa getting hammered after a rocky start to earnings season. bob pisani is at the index universe.com etf conference. it is in boca raton.

bob, we've seen commodity etfs, an explosion there this year. >> yeah. 800 investment professionals had specific conferences, specific meetings around how to invest in commodity etfs. in 2010 you're going to see emerging market sector funds that are going to be coming out in the etf area that'll make it easier to invest in some of the big commodity names out there. for the moment let me show you a graph here of all the money that's being going in. big two sectors 2009 will remain in 2010. emerges markets and commodities. fixed income got a will the of inflows. international market, $32 billion in income. there's your commodities at $29 billion. currencies coming on strong. still relatively strong. deutsche bank, dbc, what's great about the dbc is you're going to be getting access to simple agriculturals as well as the energy complex and the little bit of the precious metals. that's why it's so popular. a mix all at once.

that's got about $4 billion in assets. the second thing, agriculture, the dba, that really came on big this year as people tried to diversify out of the energy sector because a lot of these funds are rather concentrated in energy. joe, i'm hearing you're dumping on my etfs here, that you don't like them for some reason? what's the problem? >> i'm sorry. is anyone down there in florida going to fix the problem with the commodities and etfs? they don't track properly. you've got to pay a premium every month to stay in the game. i don't want to own something like that. >> wait a minute. joe, the uso had some problems. the ung had some problems. put the dbc back up here. once you own the dbc you are owning futures contracts ahead of it. it's the same thing as owns an individual futures contract. i would agree with you if there was significant tracking numbers here. you don't see them. in those individual ones. let me also say if you own an individual etf that actually owns the underlying commodity like the gld, gold, now i'd have a very good reason for why i

might want to own a futures contract for the reasons you'd want to own a futures contract versus owning an individual stock. if you've got a big, big commodity play like the dbc out there that actually owns futures and there's not a lot of tracking error, i wouldn't understand what the difference is between opening that and a basket of futures. >> is there a danger with potentially posing position limits in terms of how many you can own for these etfs? that will lead to a tracking error as we have seen. >> yeah. they'll start trading at premiums. i'm opposed to this idea. this was the hot topic. i think they'll make a ruling on thursday. i'll tell you why it's a bad idea. position limits were put on to avoid an individual or a firm from amassing an overwhelming position of an individual commodity. there's a good reason to put it on. with etfs you have thousands of individuals that are making individual decisions to buy or sell commodities. it's not a single entity. it's not a single intellectual person or company sitting there. for that reason, i think it's a bad idea to impose position limits on etfs or commodities.

>> bob, it's karen. just getting further in that point, you're saying if you own one of these etfs, aren't you taking on whatever the underlying issue is, commodity risk, but also the structural risk? it may trade at a premium. what if it's something like the etf says you can't own all that underlying and they have to actually liquidate? >> structural risk, regulatory risk is the technical reason. you're correct. you now have a risk. i hope that's why everybody down here is hoping that cft makes a ruling one way or another sooner or later. i think they're going to be a lot smarter than this, karen. i think they are going to exempt k commodity etfs. >> thanks so you. good reporting from the conference down there. are you ditching the earnings season mine field by ditching stocks and buying etfs instead? if you've got a question on your next etf strategy we'd like to hear about it. fastmoney at

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st. jude just really caught my attention this morning. it really started last night. last night they had a warning of whether or not they could actually achieve the 15% growth. whether they do or not they still actually talked about double digit growth. the stock pulled back yesterday. today options activity in the february upside calls, that got my attention. 65 cents and 70 cents were being purchased. enormous numbers were being purchased. that sparked me to want to actually tag along with these guys. i am. i bought a few calls along the way. i'm staying flexible here but it's a very, very interesting call as the device makers, whether or not the health care debate goes up or down, these device makers seem to be in the right position at the right time. >> all right. st. jude stock closed lower on the session. of course, their february strike so you have until february expiration for the trade to work for you. right now it's against you. time's on your side. >> these calls finished higher. they were b

they traded over 8,000 on the day. the normal trading volume in this stock is 1,300 option contracts per day. they traded over 10,000 before noon. it really attracted me. that's what really got me going. i was watching this very closely. why not take a shot? i like this stock. i think it's cheap right now. i know the rest of the desk is pounding the table on some of the device makers. i think is a name that can go the next level higher. >> karen, you like device makers but not st. yud necessarily? >> actually, we do have a position in st. jude. we have a little bit of bsx. all of those were down today except for bsx. but we didn't really trade around them. >> okay. let's move on to review some of the calls of the day. the big research calls from the best analysts out there. first call here, bank of america upgrading procter & gamble to a buy today citing the company's long term strategy. interesting timing on this call since bmo downgrade or cut estimates on -- yesterday because of the devaluation. >> overstayed on their exposure in venezuela.

procter & gamble from the food prices, general mills, conagra, all benefit from lower wheat and corn prices. >> fbr doubling down on -- robust demand for coal. >> will we ever get used to that? >> i'm not sure. >> i know what you're all thinking. it's not -- >> it seems like everybody's jumping into this whole play that it's not just about metal. it's also about thermal coals. we're talking about walter energy. btu. massey. all these names continue to move to the upside. today they pulled back once again. if you're waiting for a pullback you're getting your shot. i like all these names. >> for china it's 1.1% of growth for every percent of gdp growth. 10% in terms of energy con supgs because their gdp is expected to be about 9%. >> i think it's a long-term

trade on coal. coal is not a trade you're putting on getting out of next week. it's a trade you'll probably have for the remainder of 2010. >> india. tim, i thought of you when i was talking to that analyst today. 42%, you know, of coal exports to india -- >> listen to you. absolutely. great numbers. the industrial production numbers out of india 11.7%. these guys are cruising. we talked about auto sales. the coal story has got a lot of legs even if china tips their foot on the brake. >> all right. let's move on to the next call. citi upgrading domino's pizza to buy. citing increased sales trends. could domino's finally be a buy after admitting the worst kept secret in the food business? that their pizza is terrible? >> there comes a time when you know you've got to make a change. >> i hear what some folks are saying about our stuff. >> worst excuse for pizza i've ever had. >> the sauce tastes like ketcup.

>> when i was in college, i liked the two for $11. >> it was food. >> it's not a culinary sort of calculation. >> i guess not. >> there's other things going on. >> i guess not. coming up next, tiffany sales jumped nearly 20% during the hol dais. but karen says a trade is in red bull's eyes, not little blue boxes. ask me.

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welcome back. we are live at the nasdaq market site in times scare. we have a fast message here because we do check our inboxes. it is on etfs. reginald from dallas writes there's some talk about the risk soerkted with leverage etfs. can such risks by hedged by protecting the leveraged etfs with long puts? wow, pete, what do you say? >> the idea behind the leveraged etf is to trade it. it's not an investment. from that perspective i think you trade the leveraged effs. you don't get around all the rest of it. every day the recalibration and the rest of it is why it doesn't always move the way people would expect in the longer term. >> karen, you're pretty cautious

when it comes to leveraged etfs in general. >> one of them's going to blow up some day. i don't know which one. maybe the puts will help you. maybe not. >> being short puts in those things is really dangerous. >> don't short puts in leveraged etfs. that's scary stuff if they're uncovered. >> etf fever all week this week on "fast money." if you have a question, write in. we'll do our best to answer those questions. time for finerman's fine print where karen tells us which stocks she has in her sights. karen, the rich may not be getting any richer. high end retailers may be overvalued? >> i like to play in the high-end retail world. these stocks have really taken -- their run is too much for what's happened i think in the underlying economy and for consumers.

if you look at some of the names, the most typical names you think of when you think of high-end retailers, tiffany, ralph lauren, those are each trading at significant premiums to their long term pe multiple. that's a big red flag. they're still recovering. still, the multiple is too high. instead i'm feeling way more comfortable down scale. walmart, a name i've talked about. names like target trading below its five-year multiple. tjx also well below its five-year multiple. those are places where i think you can be and feel comfortable even if the economy doesn't -- it's not a straight shot up, there's still value there in both target and tjx. i'd buy them both. target right here i think is still good. tjx becomes in a little, 37.5, i think it's good to own there. >> the barbell trade? >> the barbells moved, high ends moved so much i think the relative value isn't there. tjx. >> let's move on to today's edition of hops and drops.

we kick it off here with a drop. pet row down 2%. >> a high beta and emerging market bell weather. >> got a pop for infosystems. >> hopefully a preview for the rest of the technology space in earnings. growth of 6.8%. 52-week high today. it's a name you can still own. >> drop for gap. down 3%. karen? >> gap. just can't get on goldman sack's way. they downgraded. >> not many stocks can these way. drop for electronics arts. >> the turnaround is very difficult. this is the second time they reduced their full year outlook. that's a problem for the company. i think around 15 bucks it might get interesting. until then stay away. >> a pop for the federal reserve. >> about time. >> calculations by "the washington post." the federal reserve booked a $45 billion profit last year, highest earnings in its 96-year history. much of that profit came from the fed bond purchases aimed at driving down interest rates.

ben bernanke still brings in a salary less than $200,000 per year with bonuses. >> no bonuses. does he get a bonus? >> no bonus. >> what does he have to do to get a bonus? >> he doesn't get a bonus. >> they don't let wall street, ben bernanke better shot. >> a major vehicle for hedge funds to get short brazil if they think it's going down, they did today. >> a pop and then a drop for cit. complicated trade today, joe. >> very complicated trade. a little bit of a trade school here. speculation was john thain stepping in as ceo. i'm going to use an analogy here. the entire desk can play with this one. karen's an l.a. girl. this time last week did anyone think pete carroll was leaving usc? absolutely not. don't make a trade based on who the ceo may or may not be. >> pop here for cake, cheesecake factory up 6%. karen? >> i love the product. i'm actually not a huge fan of the stock. they did guide higher.

worth 6%. not for me. stay away. >> amgen was a draw. pete wasn't a buyer. >> getting very close. i misspoke earlier talking about a dividend. i wanted to refer to their cash position. very strong. i like the stock. >> we got a drop for cougars. the kugers. not the animals. no. not the animals. cougars will no longer be taking to the high seas as carnival cruiselines has turned down requests, plural, requests for more trips like the one previously reported about which mingled older women with younger men. the first drew about 300 passengers. the cruiseline wants to focus on family. >> they're not called younger men. they're called willing prey. they're called cubs. >> how would you know, tim? >> that's what they say. >> i'm still trying to figure out at what age you become a cougar. >> old.

>> coming up next, one wall street ceo is putting his foot down on the bonus backlash. why he's saying he's not taking anymore banker bashing. the trade behind his trade from guy adami. you're watching fast money on cnbc. what are you doing...? calling chase sapphire, seeing if we have enough points to stay longer. now? you don't have enough time... and you have to push all those buttons... no buttons, someone answers every time. yeah, right... bet you a massage... yeah, ok. hi, julie... i have a question about my points. hi, what button do i press for a massage? hello? new chase sapphire... you call. we answer. no waiting. just press right here... go to chase.com/sapphire. chase what matters.

welcome back. time to go around the floor. jp morgan's jamie diamond making headlines as he defend's the banks pay policy saying he was tired of his employees being vilified over bonuses. let's check on the fast line. you know who's called in, the negotiator, guy adami. can't take a break from the show. you've been pounding the table on these bonuses. >> you're damn right. leave these cats alone. it's about time jamie dimen got on the offensive. everybody that's yelling and screaming about compensation for these guys are the same guys that would jump to work for them if they could get a job there. shut up, leave them alone and move forward. speaking of moving forward, the trade-off jp morgan this friday, remember those who cannot remember the past are condemned to repeat it. meredith whitney back on

december 18th took her numbers down for jp morgan. i think the surprise will be to the downside. another surprise for you, i'll be back tomorrow. you know who's going to be back? new hip and all, baby, regis philbin. >> we should disclose, you used to work for goldman sachs. >> hell yeah, girl. and proud of it. i'm not hiding that. >> too bad he's not passionate. >> yeah. too bad. really no feeling on that subject. all right. on thursday we will discuss jamie dimon's comments with the man, the pay czar himself, ken feinberg, that is thursday on "fast money." certainly that will be an interesting conversation given the earnings release the next day from jp morgan and all the commentary that has gone on so far. karen, from a shareholder perspective when you hear about the banks like bank of america,

let's say, paying record bonuses to some individuals as reports have been out there, is that a concern for you as a shareholder? do you think they should be rationing that back? >> i think to set up a business model where you can take on risk and be paid in the short term isn't a good one. but if they are paid for earnings that they actually do generate, i'm all right with that. as a shareholder, ultimately bottom line is all that i care about. >> okay. let's move on to what was top on the tape today. mcdonald's, stock closing flat. yeah. that's topping the tape. when it's a down tape. after announcing it will be getting to offer free wi-fi at most of its u.s. stores. pete, we do know you're a big fan. >> big fan. >> you decided to actually move your home office to mcdonald's today to take advantage of the free wi-fi. there pete is working. maybe eating, nibbling on -- what is that? a big mac or something. >> mcmuffin. >> he's at the drive-through.

miraculously it looks like you're on a hov around. >> i like that wi-fi at mcdonald's. >> look at you in the ball pit. >> that's how you fight against all the flu vaccines. just go right in there. you don't need a shot. >> build up your immunity. get tough, people. >> did you actually do some trades from there? >> while you can, no. >> what is the trade on mcdonald's? is it a good thing. >> i love it at these levels. i'd like to see it close to $60. karen's got a position already in there. would you still hold it? >> yes. i like mcdonald's. like them both. >> free wi-fi is actually a boost. >> yeah. another reason to go there. they've been going after starbucks with the mccafe and everything else. one more reason. it used to be $2.95. now it's free. the one airline, coming up next, the one airline where joe refuses to check his bags. wonder which one that is. final trade right after this. ♪

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all right. time now for the final trade. let's go around the horn. >> chevron gave disappointing guidance on refining margins. >> joe? >> e remain short continental airlines actually sold a little more today. >> karen? >> target. i like it. good value. >> stepete?

>> no position. i got to do something on amgen very soon. >> i'm melissa lee. we'll see you tomorrow night 5:00 p.m. eastern time. do not miss tonight on "the kudlow report" the e kree john . ♪ [ male announcer ] introducing the all-new lexus gx. ♪ it has the agility to avoid the unexpected... ♪ ...the power to take on any mission, and the space to accommodate precious cargo,